APAC mobile app downloads to hit 5B in 2011

Region's mobile app downloads expected to skyrocket 189 percent to five billion and revenues from paid apps to hit US$871 billion this year, new study shows.

Asia-Pacific handset users show insatiable appetite for mobile apps as downloads expected to shoot up to five billion this year, with paid app revenue to reach US$871 billion. Android apps also trump iOS apps for the first time, according to a new report.

Released Thursday, the study from Ovum forecasted that mobile app downloads will grow 189 percent from the 1.6 billion downloaded in 2010 to reach five billion this year. This momentum is expected to carry through to 2016 with download figures to hit 14 billion then, it stated.

"Consumer's seemingly insatiable demand for mobile applications is set to continue this year, with downloads from app stores increasing around the world," said Nick Dillion, devices analyst at Ovum, in the report.

Looking deeper into the findings, Ovum is predicting that Asia-Pacific revenues from paid apps will reach US$871 million in 2011, an uptick from US$302 million last year. The market will go on to achieve revenues of US$2.2 billion in five years, it added.

"The outlook for the longer term is also positive, with consumers set to continue to use apps to add new features to their phones and to access their favorite services on the go," Dillon pointed out.

Android's time to shine
Beyond app downloads and revenue, the report also showed that growing Android adoption will "upset the Apple cart" as it "steals dominance" of total downloads from erstwhile leader, Apple and its iPhone device.

In the Asia-Pacific region, there will be 1.8 billion Android apps downloaded compared to Apple's 1.5 billion, Ovum noted. Comparatively, Android garnered 244 million app downloads while Apple saw 424 million app downloads in 2010.

Looking ahead, the research firm expects Android's dominance to "soar" and, by 2016, will almost double the download count relative to iOS apps with 6.07 billion apps consumed by users compared with 3.4 billion of iOS apps.

"The huge lead in downloads that Android will take on Apple is being driven by the growth of the platform as a result of its increasing popularity and progress into lower price points [of Android-powered handsets]," Dillon said.

The analyst did point out that while Android will lead in download numbers, Apple's mobile platform will continue to "dominate" the Asia-Pacific market in terms of paid apps revenue, reaching US$808 million in 2016 compared with US$394 million for Android.

Low tolerance for "second-rate" apps
That said, Eden Zoller, Ovum's consumer telecoms principal analyst, noted that as the more affluent segment in emerging markets become familiar with mobile applications, there will be "less tolerance for second-rate apps".

"Charging top-end premiums for smartphone apps is becoming increasingly difficult. The majority of paid apps are in a commodity pricing zone and those capable of pushing above the US$5 mark are in the minority," she said.

Zoller added that app-savvy consumers are only willing to splash the cash for "must-have" apps, and the challenge for developers is to create such software as it varies by customer segment and the individual.

Good candidates are utility apps that bring increased productivity and convenience or those deemed "cool, fashionable and fun" such as the release of a long-awaited blockbuster game, for example, she noted.